Vertex Pharmaceuticals (VRTX) Message Board

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Biotech / Medical : Vertex Pharmaceuticals (VRTX)

VRTX 457.48

+3.5%

12:24 PM EST

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To: David Lieberman who started this subject	10/21/2003 8:23:31 PM
From: mopgcw	of 1169

GS Note: Vertex Pharmaceuticals, Inc. EPS (FY Dec) 2003E ($2.05), 2004E ($2.11) In-Line/Neutral (VRTX) $13.03 Last night the FDA announced approval of AIDS agent, GW433908/VX-175, a protease inhibitor developed by GlaxoSmithKline and Vertex. As with first generation compound, Agenerase, Vertex will receive royalties on 908, which we believe may be launched in the fourth quarter of this year with the brand name Lexiva. Our European team estimates peak potential may approximate $400 million. We estimate that Vertex may earn potential royalties around the 15% level and a higher level after an undisclosed sales level is reached. While approval was expected we regard it as an incremental positive for Vertex. Other milestones in the second half are on track, including potentially, top line Phase IIa data on Pralnacasan in osteoarthritis, and top line Phase IIa data on VX-148 in psoriasis. We maintain In-Line/Neutral rating based on valuation and time frames required to develop the pipeline. We regard Vertex as a leader in small molecule development. Key risks include potential clinical failures, long development time frames and sector volatility.

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